End of era for Menzies with sale of print media arm
● Closes door on 180+ year history in newspaper trade ● Move follows investor pressure to break up group
Yesterday marked the end of an era after logistics group John Menzies, one of Scotland’s oldest companies, announced the sale of its print media division Menzies Distribution in a £74.5 million deal.
The Edinburgh-based plc said the proposed disposal to private equity fund manager Endless LLP creates a business wholly focused on global aviation services, “operating in a structural growth market and marks Menzies’ exit from the market for print media and retail logistics”.
The group’s roots date back to 1833 when its eponymous founder opened a bookshop on Edinburgh’s Princes Street, which began selling The Scotsman newspaper over the counter and Menzies became known for retailing and wholesaling.
The disposal, subject to shareholder approval and expected to complete in September, had long been on the cards, with financial adviser Rothschild & Co appointed in 2016 to look at splitting the group after calls from activist investors for a break-up.
Menzies said in May that various potential buyers had expressed interest in the division, after talks to merge it with parcels group DX collapsed in 2017. Menzies will keep a 10 per cent equity stake in the distribution firm. John Geddes, group company secretary and corporate affairs director, told The Scotsman: “Obviously it’s been our stated strategy for a while now, but to split the group, we see it very much as creating two strong companies. Menzies Distribution still has a very bright future, we just see the future of John Menzies plc more in the aviation space and we’ve got to focus our investment there..
On conclusion of the deal, Forsyth Black, currently president and managing director of Menzies Aviation, will be appointed chief executive of John Menzies and will be supported by Giles Wilson, chief financial officer, plus Geddes.
The latter said the aim now is to capitalise on strong dynamics in aviation, looking to grow in existing markets, “but we’re very interested in places like the Middle East and Southeast Asia”, and expand its fuelling business across Europe.
He added: “I think today for us, for John Menzies plc, is very much about the end of our strategic realignment… We’re a strong Scottish company, we’re going to be based in Edinburgh and we’re a global [wholly] aviation business now, so it’s very much about the creation of that rather than the sale of distribution, almost. We’re very excited about the future.”
Christian Kappelhoff-wulff, boss of Menzies shareholder Lakestreet Capital Partners, welcomed the move, which it has “strongly advocated” since March 2015. Menzies shareholders “will now fully benefit from the significant growth opportunities available in a quickly consolidating industry.”